Book-Keeping and Accountancy · Ch 4 — Ledger
Posting from Journal to Ledger
Posting from Journal to Ledger
Transferring an entry from the Journal to the appropriate accounts in the Ledger is called Posting.
Posting
Posting is the process of transferring the debit and credit aspects of a journal entry to their respective accounts in the Ledger.
Rules of posting
- Open a separate account in the Ledger for every account named in the Journal, if one does not already exist.
- The account debited in the Journal is written on the Debit side of that account in the Ledger, with the word "To" followed by the name of the account credited in the same journal entry.
- The account credited in the Journal is written on the Credit side of that account in the Ledger, with the word "By" followed by the name of the account debited in the same journal entry.
- The date of posting is the same as the date of the journal entry.
- The amount posted is exactly the amount shown in the Journal for that entry.
- The J.F. column of the Ledger account carries the page number of the Journal, and, as a cross-reference, the L.F. (Ledger Folio) column of the Journal is filled in with the page number of the Ledger account once posting is complete.
Notice that posting always uses the NAME OF THE OTHER ACCOUNT, never the name of the account the entry is itself being posted into — that is exactly what "To" and "By" refer to.
Illustration. The transactions of Mr. Ajay, who started a stationery trading business on 1st April 2024, are given below. They are posted, and every account is balanced, across this section and the next.
Transactions of Mr. Ajay — April 2024
| Date (2024) | Transaction | Account Debited | Account Credited | Amount (₹) |
|---|---|---|---|---|
| Apr 1 | Started business with cash | Cash A/c | Capital A/c | 1,50,000 |
| Apr 2 | Purchased goods for cash | Purchases A/c | Cash A/c | 50,000 |
| Apr 4 | Purchased furniture for cash | Furniture A/c | Cash A/c | 15,000 |
| Apr 8 | Sold goods for cash | Cash A/c | Sales A/c | 35,000 |
| Apr 12 | Sold goods to Ravi on credit | Ravi's A/c | Sales A/c | 25,000 |
| Apr 15 | Paid rent | Rent A/c | Cash A/c | 6,000 |
| Apr 20 | Received cash from Ravi | Cash A/c | Ravi's A/c | 18,000 |
| Apr 25 | Paid salaries | Salaries A/c | Cash A/c | 10,000 |
| Apr 28 | Purchased goods from Suresh on credit | Purchases A/c | Suresh's A/c | 20,000 |
| Apr 30 | Paid cash to Suresh | Suresh's A/c | Cash A/c | 12,000 |
Applying the posting rules to just the FIRST transaction (Apr 1) shows exactly how one transaction lands, twice, in two different accounts of the Ledger: …
The process of transferring the debit and credit aspects of a journal entry to their respective accou …